LibiranNotes|1
A. FRANCISCO REALTY AND DEVELOPMENT
CORPORATION, petitioner, vs. COURT OF APPEALS and
SPOUSES ROMULO S.A. JAVILLONAR and ERLINDA P.
JAVILLONAR, respondents.
FACTS:
Petitioner A. Francisco Realty and Development Corporation
granted a loan of P7.5 Million to private
respondents, the spouses Romulo and Erlinda Javillonar, in
consideration of which the latter executed the following
documents:
(a) a promissory note, dated November 27, 1991, stating an
interest charge of 4% per month for six months;
(b) a deed of mortgage over realty covered by TCT No.
58748, together with the improvements thereon; and
(c) an undated deed of sale of the mortgaged property in
favor of the mortgagee, petitioner A. Francisco Realty
Thei nterest on the said loan was to be paid in four
instalments
The promissory note expressly provided that upon failure of
the MORTGAGOR [private respondents] to pay the interest
without prior arrangement with the MORTGAGEE
[petitioner], full possession of the property will be
transferred and the deed of sale will be registered.
February 21, 1992 - Private respondents failed to pay the
interest and, as a consequence,Petitioner registered the sale
of the land in its favor
TCT No. 58748 was cancelled and in lieu thereo TCT No. PT-
85569 was issued in the name of petitioner A. Francisco
Realty.
March 13,1992 - Private respondents subsequently obtained
an additional loan of P2.5 Million from petitioner
PN issued by private respondent reads:
XX“For value received, I promise to pay A. FRANCISCO
REALTY AND DEVELOPMENT CORPORATION, the
(P2,500,000.00) on or before April 27, 1992, with interest at
the rate of four percent (4%) a month
If debts remained unpaid and/or unsettled, without any need
for prior demand or notification, I promise to vacate
voluntarily and willfully and/or allow” XX
May 1992- Petitioner demanded possession of the mortgaged
realty and the payment of 4% monthly interest from plus
surcharges.
As respondent spouses refused to vacate, petitioner filed the
present action for possession before the Regional Trial Court
in Pasig City.
RTC declared the ownership of petitioner as valid.
CA revesed Regional Trial Court had no jurisdiction
over the case because it was actually an action for unlawful
detainer which is exclusively cognizable bymunicipal trial
courts. Void due to pactum commisorium.
HELD:
1. RTC has jurisdiction.
Unlawful Detainer withholding from by a person from another
for not more than one year, the possession of the land or
building to
which the latter is entitled after the expiration or termination of
the supposed rights to hold possession by virtue
of a contract, express or implied (RULE 70 of RULES OF
COURT)
What really distinguishes an action for unlawful detainer from a
possessory action (accion publiciana) and from a reivindicatory
action (accion reivindicatoria) is that the first is limited to the
question of possession de facto.
Forcible entry and unlawful detainer are quieting processes
and the one-year time bar to the suit is
in pursuance of the summary nature of the action.
The use of summary procedure in ejectment cases is
intended to provide an expeditious means of protecting
actual possession or right to possession of the property.
They are not processes to determine the actual title to an
estate. If at all, inferior courts are empowered to rule on
the question of ownership raised by the defendant in such
suits, only to resolve the issue of possession.
The allegations in both the original and the amended
complaints of petitioner before the trial court clearly raise
issues involving more than the question of possession
In this case, it is therefore clear from the foregoing that
petitioner A. Francisco Realty raised issues which involved
more than a simple claim for the immediate possession of
the subject property.
2.There is Pactum Commissorium
ART. 2088. The creditor cannot appropriate the things given
by way to pledge or mortgage, or dispose of them. Any
stipulation to the contrary is null and void.
The aforequoted provision furnishes the two elements for
pactum commissorium to exist: (1) that there should be a
pledge or mortgage wherein a property is pledged or
mortgaged by way of security for the payment of the principal
obligation; and (2) that there should be a stipulation for an
automatic appropriation by the creditor of the thing pledged or
mortgaged in the event of non-payment of the principal
obligation within the stipulated period.[21]
To sustain the theory of petitioner that
..XXTHE PROSCRIBED STIPULATION SHOULD BE FOUND
IN THE MORTGAGE DEED ITSELFXX
would be to allow a subversion of the prohibition in Art.
2088.
The subject transaction being void, the registration of the deed
of sale, by virtue of which petitioner A. Francisco Realty was
able to obtain TCT No. PT-85569 covering the subject lot, must
also be declared void, as prayed for by respondents in their
counterclaim.